Professor Mike Fulford at the dig in Silchester. The latest find is an olive stone that dates back to Iron Age Britain. Photograph: Graham Turner for the Guardian

Iron Age Britons were importing olives from the Mediterranean a century before the Romans arrived with their exotic tastes in food, say archaeologists who have discovered a single olive stone from an excavation of an Iron Age well at at Silchester in Hampshire.

The stone came from a layer securely dated to the first century BC, making it the earliest ever found in Britain – but since nobody ever went to the trouble of importing one olive, there must be more, rotted beyond recognition or still buried.

The stone, combined with earlier finds of seasoning herbs such as coriander, dill and celery, all previously believed to have arrived with the Romans, suggests a diet at Silchester that would be familiar in any high street pizza restaurant.

The excavators, led by Professor Mike Fulford of Reading University, also found another more poignant luxury import: the skeleton of a tiny dog, no bigger than a modern toy poodle, carefully buried, curled up as if in sleep. However it may not have met a peaceful end.

"It was fully grown, two or three years old, and thankfully showed no signs of butchery, so it wasn't a luxury food or killed for its fur," Fulford said. "But it was found in the foundations of a very big house we are still uncovering – 50 metres long at least – so we believe it may turn out to be the biggest Iron Age building in Britain, which must have belonged to a chief or a sub chief, a very big cheese in the town. And whether this little dog conveniently died just at the right time to be popped into the foundations, or whether it was killed as a high status offering, we cannot tell.

"The survival of the olive stone, which was partly charred, was a freak of preservation. But there must be more; we need to dig a lot more wells."

Fulford has been leading the annual summer excavations at Silchester, which bring together hundreds of student, volunteer and professional archaeologists, for half a lifetime, and the site continues to throw up surprises. It was an important Roman town, but deliberately abandoned in the 7th century, its wells blocked up and its buildings tumbled, and never reoccupied. Apart from a few Victorian farm buildings, it is still open farmland, surrounded by the jagged remains of massive Roman walls.

Fulford now believes that the town was at its height a century before the Roman invasion in 43AD, with regularly planned, paved streets, drainage, shops, houses and workshops, trading across the continent for luxury imports of food, household goods and jewellery, enjoying a lifestyle in Britain that, previously, was believed to have arrived with the Romans.

This sodden summer have driven the archaeologists to despair, with the site a swamp of deep mud and water bubbling up in every hole and trench.

"Conditions are the worst I can ever remember. Ironically, the wells are the easiest to work in because we have the pumps running there," Fulford said.

The tiny dog is one of dozens that the team has excavated here over the years, including one that was buried standing up as if on guard for 2,000 years. A unique knife with a startlingly realistic carving of two dogs mating was another of the spectacular finds from one of the most enigmatic sites in the country.

Visitors can observe the archaeologists' trench warfare this weekend, when the site opens to the public as part of the national festival of archaeology, one of thousands of events across the country.